Banks are ramping up competition to attract students by offering cash, discounts and other perks.
With people sorting out their finances over the summer as they prepare to head to university for the first time this autumn, some banks have launched new student account deals.
NatWest has a new student account which will offer £50 cash and a four-year tastecard membership offering discounted meals at many restaurants and takeaways, in addition to discounted cinema tickets and shopping offers.
The student account also has a £2,000 interest-free overdraft, available in the first year of study.
Andy Nicholson, NatWest’s student account expert, said: “It is the first time we have offered a cash incentive on our student account and this combined with the tastecard membership will hopefully help every student make the most of their university experience.”
During the years of study, a generous interest-free limit would provide students with a financial safety netRachel Springall, Moneyfacts.co.uk
To be eligible, students must be studying at a UK university or college and be completing a full-time course lasting at least two years. The account is also open to customers training to be a nurse.
Within 30 days of account opening, new customers also need to register for online or mobile banking and opt to receive paperless statements. They will then receive the £50 cash and tastecard membership.
Earlier this month, HSBC UK announced details of its account.
HSBC UK is offering students £80 in cash as well as a choice of either a £20 Uber Eats voucher, or a year of unlimited next-day delivery with Asos Premier.
The bank will also give students a £1,000 interest-free overdraft buffer in the first year, which could increase to £2,000 in year two and £3,000 in year three.
Fiona Anderson, HSBC UK’s head of everyday banking, said previously that the disruption from the coronavirus pandemic has added to what would already be a “stressful time” for students.
Students will need to weigh up the different options available to work out which deal on the market will suit their needs best in the long term, rather than just focusing on initial perks.
The nearest bank to their campus may not necessarily be the best one for them financially.
Rachel Springall, a finance expert at Moneyfacts.co.uk, said, traditionally, a broader range of providers start to reveal what they are offering to students in late July and early August.
She said: “It’s great to see some offers surfacing for prospective students comparing bank account options in the run-up to the new academic year.
“The NatWest £50 offer and tastecard membership are decent perks and the account comes with a £2,000 interest-free overdraft facility too.
“Student perks last year included a railcard offer, coachcard and Amazon Prime student offers. Cashback up-front for opening an account however wasn’t really present.
“Students searching for a bank account would be wise to weigh up any perks that may be on offer with the interest-free overdraft that the account carries.
“During the years of study, a generous interest-free limit would provide students with a financial safety net.”
Ms Springall added it is worth considering that overdraft borrowing will eventually need to be paid back.
She said: “It has been a difficult period for many due to the pandemic so any concerned students could discuss their financial situation with family or friends if they feel anxious and contact their bank if they need support.”